Which of the Following Is True About the User of Derivatives

question 9

Multiple Choice

Which of the following is true about the user of derivatives?

• A) Derivatives usually appear explicitly in the financial statements.
• B) Academic surveys account for much of our knowledge of corporate derivatives use.
• C) Smaller firms are more likely to use derivatives than large firms.
• D) The most frequently used derivatives are commodity and equity futures.
• E) None of these. are truE.

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Definitions:

Balance Sheet

A financial statement that summarizes a company's financial position at a specific point in time, detailing assets, liabilities, and shareholders' equity.

Sales On Account

Transactions where goods or services are sold but payment is deferred to a future date, typically recorded as accounts receivable.

Cost Of Goods Sold

Costs directly related to creating products for sale by a company, encompassing expenditures for labor and materials.

Inventory Turnover

A ratio showing how many times a company's inventory is sold and replaced over a specific period, indicating the efficiency of inventory management.